MSG Team's other articles

10494 Obstacles in Manpower Planning

Following are the main obstacles that organizations face in the process of manpower planning: Under Utilization of Manpower: The biggest obstacle in case of manpower planning is the fact that the industries in general are not making optimum use of their manpower and once manpower planning begins, it encounters heavy odds in stepping up the […]

8794 Staffing Function of Management

The managerial function of staffing involves manning the organization structure through proper and effective selection, appraisal and development of the personnels to fill the roles assigned to the employers/workforce. According to Theo Haimann, “Staffing pertains to recruitment, selection, development and compensation of subordinates.” Nature of Staffing Function Staffing is an important managerial function- Staffing function […]

12683 Centralization and Decentralization

Centralization is said to be a process where the concentration of decision making is in a few hands. All the important decision and actions at the lower level, all subjects and actions at the lower level are subject to the approval of top management. According to Allen, “Centralization” is the systematic and consistent reservation of […]

10722 Principles of Delegation

There are a few guidelines in form of principles which can be a help to the manager to process of delegation. The principles of delegation are as follows: – Principle of result excepted This principle suggests that every manager before delegating the powers to the subordinate should be able to clearly define the goals as […]

12173 Relationship between planning and controlling

Planning and controlling are two separate fuctions of management, yet they are closely related. The scope of activities if both are overlapping to each other. Without the basis of planning, controlling activities becomes baseless and without controlling, planning becomes a meaningless exercise. In absense of controlling, no purpose can be served by. Therefore, planning and […]

Search with tags

  • No tags available.

Employee Remuneration refers to the reward or compensation given to the employees for their work performances. Remuneration provides basic attraction to a employee to perform job efficiently and effectively.

Remuneration leads to employee motivation. Salaries constitutes an important source of income for employees and determine their standard of living. Salaries effect the employees productivity and work performance. Thus the amount and method of remuneration are very important for both management and employees.

There are mainly two types of Employee Remuneration

  1. Time Rate Method
  2. Piece Rate Method

These methods of employee remuneration are explained below in detail

Methods of Employee Remuneration

  1. Time Rate Method: Under time rate system, remuneration is directly linked with the time spent or devoted by an employee on the job. The employees are paid a fixed pre-decided amount hourly, daily, weekly or monthly irrespective of their output. It is a very simple method of remuneration. It leads to minimum wastage of resources and lesser chances of accidents.

    Time Rate method leads to quality output and this method is very beneficial to new employees as they can learn their work without any reduction in their salaries. This method encourages employees unity as employees of a particular group/cadre get equal salaries.

    There are some drawbacks of Time Rate Method, such as, it leads to tight supervision, indefinite employee cost, lesser efficiency of employees as there is no distinction made between efficient and inefficient employees, and lesser morale of employees.

    Time rate system is more suitable where the work is non-repetitive in nature and emphasis is more on quality output rather than quantity output.

  2. Piece Rate Method: It is a method of compensation in which remuneration is paid on the basis of units or pieces produced by an employee. In this system emphasis is more on quantity output rather than quality output.

    Under this system the determination of employee cost per unit is not difficult because salaries differ with output. There is less supervision required under this method and hence the per unit cost of production is low. This system improves the morale of the employees as the salaries are directly related with their work efforts. There is greater work-efficiency in this method.

    There are some drawbacks of this method, such as, it is not easily computable, leads to deterioration in work quality, wastage of resources, lesser unity of employees, higher cost of production and insecurity among the employees.

    Piece rate system is more suitable where the nature of work is repetitive and quantity is emphasized more than quality.

Article Written by

MSG Team

An insightful writer passionate about sharing expertise, trends, and tips, dedicated to inspiring and informing readers through engaging and thoughtful content.

Leave a reply

Your email address will not be published. Required fields are marked *

Related Articles

Types of Recruitment

MSG Team

Training of Employees – Need and Importance of Training

MSG Team

Staffing Process – Steps involved in Staffing

MSG Team